Shell looks to gas-fired future

Australia must put more emphasis on LNG as a future fuel source to ensure energy security, Shell says

Australia should place more emphasis on LNG as a future fuel source, as part of a strategy to ensure energy security, the head of Shell Australia says.

Speaking in Perth at a meeting of the Committee for Economic Development of Australia (CEDA), Shell Chairman Russell Caplan says more investment is needed to take advantage of Australia’s natural gas reserves.

Pointing to Shell’s decision to support the design, construction and instillation of multiple floating LNG processing facilities, Caplan says there are numerous other projects that will also require funding totalling trillions of dollars to bring to fruition.

Without this ongoing investment, which Caplan says has been jeopardised by the current financial crisis, there is a risk ‘the world will face an energy supply crunch around the middle of the next decade’.

Caplan says the key to inducing companies to invest in longterm projects such as natural gas, which can extend over 40 years or more, is the need for governments to maintain stable tax conditions.

"If investors don’t have long-term confidence in the stability of the tax regime, potential investments in major projects will be severely compromised," Caplan says.

"A tax regime that supports investment in LNG projects will lead to more jobs, more export income, and more tax revenue."